Reflecting on 18 Months of INDUSTRY4.UK
- Software development and forming business relationships takes time. This has to be respected when forming a new business but is often forgotten.
- Fundraising is a full time job and we were unable to juggle this task with the more productive software development.
- While we don’t consider ourselves doing anything groundbreaking, the Dorset Growth Hub was unwilling to support a Startup business.
- INDUSTRY4 Ltd and the partnership will be wound down with the founder continuing with market discovery and software development.
- The dream of creating a British Engineering company, creating new Dorset Jobs, and aligning young professionals with the world of manufacturing continues...
I can't remember when I first started to study business start-ups, but throughout that time, which has to be around 15 years, I have never focused on failure. This is odd because I consider myself a glass half empty kind of guy.
It's a topic that is often talked about but it's never really defined as it can mean so many things.
We often hear how the Americans see failure as a lesson learnt - feeling that someone who has failed is unlikely to do it again, so this gives future investors more security that their next venture will be more likely to succeed.
We also hear the opposite viewpoint from the British who resist failure at every corner. What is odd by what you read about failure is I have never met a person who has failed nor do I know many people who have regretted the decisions they have made. They merely have used it as a pivot in their life.
Pivoting is a term that flourished in the startup world - it's as a act where a startup would change direction of their original strategy while they still had the money in the bank and an energised team.
The funds at the time of the pivot dictates the success of it. Too much cash in the bank and then it can make a business the walking dead. Not enough cash and the pivot could be the correct one but the lack of funds could zap the team's energy creating a emotional roller coaster with unrealistic timelines.
The luxury one hasn't got in these pivot situations is to down tools, take 5, and regroup, essentially restarting the business.
This is hard to do if there is a team's wage bill to pay for, and if you did do the dramatic thing of winding down the business, you are letting go the biggest asset of it to date; The Team.
This is not so hard to do if the team has already faded away, or the investors have become disinterested.
This is the situation INDUSTRY4 Ltd is in and why after 18 months it's time to fail on financial grounds and consider restarting with a new team and new strategy.
The business hasn't generated any income since the first round of seed investment a year ago and raising funds is a full time job. There has been a lot of interest from many directions due to Industry 4.0 being such a hot topic, but one takeaway to respect in the future is the concept of time.
The world of business is generally slow, so to expect to be making a income from a product led business after a year is unrealistic.
Creating a service business, where you are simply selling your time, then to make a quick return is more achievable and why Britain is known for its service industry. The big downside of a service business is it lacks legacy - once everyone leaves, the company is no more.
The seed funding we acquired indirectly from the EU also seemed more on paper than it was. After the Business accelerator, desk rent and lots of other administration were paid for, this left around four months of runway to build a product and visit prospective customers.
Raising more funds during this period would have simply meant less focus on the other activities and with Julian stepping down in May, it was a case of fly or die with releasing the product into a real scenario.
After the runway dried up the business has been bootstrapped and safeguards have been put in place to allow for full time business development to continue during the normal working week.
So while the business is actually in a stable position, it doesn't remove the fact that the company, INDUSTRY4 Ltd, hasn't made any revenue and therefore the decision has been made to wind down the company on financial grounds with the partnership also ending.
Be sure to see a re-brand commencing over the coming months, unless it has already happened and you are reading this via a archived web page.